This is an article on breaking down some strategies and some considerations to be taken into account when launching your first online store.
This is not a "how-to" article. Meaning, if you're reading this now, you probably know how to set up an online store "on-paper" (store setup, accepting credit cards, social outreach, shipping logistics, etc.), and you just have some questions about the fine points of what to take into consideration and how to properly prepare for the future when setting up an online business.
This is a very multi-faceted breakdown, so we will separate the different topics into parts and publish one every few days. The different parts are as follows:
Part One: Finding and Knowing Your Product Source(s)-
We won't save the best for last as this is the absolute most important factor in running a successful online store (for obvious reasons). Here are some things to look for when finding a product source: Credibility/ quality of products and delivery, proximity, and price, in that order.
It's very important that your product source has been running for a long time with a great track record for quality products and delivery. This applies to both drop-shippers and regular online retailers. Some earmarks of these companies are: Lots of positive reviews, plenty of videos on service, and a narrow-to-medium line of products (shows focus).
Some examples of what could happen with a poor source include: Uncertain inventory levels (causing delay in insufficiently supplied orders), cheap quality products, and unexpected charges for common amenities such as reasonable shipping times and defect-returns.
Proximity is key simply because it translates to delivery time and in the event that a return occurs, reflects the urgency to satisfy a customer. Some drop-ship suppliers can take weeks to simply delivery a product, can you imagine the process and lead time of a return? Even if you send a new product before the alleged defective one is returned, you're still looking at a very unhappy customer.
To understand your price points is to bring you closer to God himself. A massive part of understanding your supplier and supplies is knowing the numbers behind every product, delivery, and return. How many sales do you need with the margins you make in order to run smoothly? How many returns can you handle? What if a batch of products are bad and need to be returned and exchanged? With the margins you have, does it give you cushion to compensate customers every time something goes wrong with their order? At what volume are you satisfied with?
These are all tough questions you must ask yourself when trying to understanding your own goals, but you must know or at least have an idea of the answers.